On the heels of Rango’s Oscar victory, Viacom president and CEO Philippe Dauman told a Deutsche Bank media and telecom investor conference in Palm Beach yesterday that Paramount will likely launch its new animation division with a SpongeBob SquarePants hand-drawn feature in late 2014, according to The Hollywood Reporter.

What’s curious is that even though the division has a mandate to make animated features under $100 million with low overhead of 20-30, Dauman did not rule out the possibility of renewing its distribution deal with DreamWorks Animation, which expires this year. DreamWorks is currently contemplating self-distribution.

Meanwhile, Paramount has also scooped up Penny Arcade’s sci-fi comic, New Kid, as an animated project (with The Book of Eli scribe Gary Whitta adapting and Mary Parent and Cale Boyter producing).

Last week David Stainton stepped down as head of the division for personal reasons after only seven months, with Paramount Motion Picture Group president Adam Goodman now in charge.